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Defamation Claims by Medical Providers

February 5, 2013

The Minnesota Supreme Court recently held that statements posted by a patient’s son online describing rude and insensitive behavior by a neurologist, and a comment allegedly made by a nurse, were not defamatory. Hospitals and other healthcare employers, however, should remain cautious about the potential for defamation lawsuits when making personnel decisions.

In McKee v. Laurion, a neurologist sued his patient’s son for defamation because of statements the son posted on various “rate your doctor” websites and letters of complaint he sent to medical institutions. Among the allegedly defamatory statements was a comment by an unnamed nurse who allegedly stated that the physician “is a real tool.”

This statement, the court held, was “pure opinion,” protected under the First Amendment because “it cannot be reasonably interpreted as stating a fact and it cannot be proven true or false.” The court rejected the physician’s argument that the possible fabrication of the existence of the nurse and the statement attributed to her created a genuine issue of fact as to the falsity of the statement, which is one of the elements of a defamation claim. Regardless of whether a nurse made the statement, the court concluded, it could not give rise to a valid defamation claim because the statement itself was an opinion and therefore “incapable” of being defamatory.

In contrast, earlier a California appellate court found that an alleged statement by hospital management that a surgeon is “incompetent” and “needs more training” was not an opinion and could constitute defamation because it could be proven true or false. Indeed, the trial court had conducted an evidentiary hearing to evaluate the doctor’s surgical technique and judgment, and determine the truth or falsity of the statement. Because the hearing established that the doctor’s surgical technique was substandard and his medical judgment was poor, the appellate court found in favor of the hospital on the doctor’s defamation claim, noting that truth is a complete defense to civil liability for defamation.

Although defamation claims are most often unsuccessful, employees, including medical providers, frequently allege defamation as part of wrongful termination lawsuits. If an employee prevails, the cost can be extremely high, particularly when a highly paid physician brings the suit. For example, a jury in Texas awarded an anesthesiologist $9.8 million in a lawsuit against his former employer, a hospital, for defamation and breach of contract. The hospital had accused the anesthesiologist of drug and alcohol abuse and medical incompetence, and fired him when he refused to submit to a peer review or to modify his employment contract. However, the hospital’s impaired physician program cleared the anesthesiologist of all charges. Based on the program’s findings, the hospital couldn’t shield itself from liability by claiming the statements were truthful.

Employees may also claim that the reason provided by the employer for termination is defamatory, whether it is communicated internally within the company, to a potential new employer, or even just to the employee. For example, some states, including Minnesota, Texas, California, and New York, have recognized the doctrine of “compelled self-publication,” which creates a cause of action when a defamatory statement is communicated only to the employee and the employee is compelled to publish the defamatory statement to a third person, such as a prospective employer. This doctrine has so far been applied narrowly, but nevertheless presents another potential claim that terminated employees can assert against their former employers.

The federal Health Care Quality Improvement Act (HCQIA) and some state laws may also protect statements made in the context of a “professional review action,” such as a peer review, if all of the statutory requirements are met, including a reasonable effort to obtain the facts of the case and the provision of notice and the opportunity for a hearing. To reduce the risk of defamation claims and other potential claims relating to the termination of hospital privileges or other adverse actions, healthcare employers are advised to consult with counsel when faced with disruptive or problem physicians or employees to understand potential claims and defenses, including the requirements for immunity from liability under the HCQIA and similar state statutes.

Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.